Extended warranties haven’t always been everyone’s favorite kind of contract.
Their less-than-stellar reputation stems from a few issues.
First, extended warranties can be confusing and hard to understand. A well-known study in the Journal of Retailing and Consumer Services found that a “large majority” of consumers misunderstand the terms and conditions, including the coverage period, of extended warranties they purchase.
Second, actually getting coverage through extended warranties can be complicated. A 2018 Consumer Reports survey found that 17% of people who had appliances repaired under extended warranties thought the fix took an unreasonable amount of time. 23% of the time, they reported that it took more than one try to get the item properly fixed. (People who paid for repairs out of pocket had fewer issues with timeliness and quality of repairs.)
And third, extended warranties can be overpriced. Per Warranty Week, a “huge chunk” of the cost of product protection plans go towards salespeople’s commissions. Consumer Reports found that for some types of product protection, like extended car warranties, consumers spend more on coverage than they save in repair costs.
But extended warranties don’t have to be confusing, hard to actually use, and expensive. When done right, warranties can give consumers peace of mind and make their lives easier if anything does go wrong. Clyde’s approach to warranties cuts out a lot of the pain points for consumers and streamlines the servicing, all while keeping it affordable for everyone involved. We’ll explain why in the rest of this blog.
Demystified terms and conditions
Clyde starts by sharing extended warranty options in clear, easy-to-understand language. Our product protection options clearly articulate what is covered, from accidents to regular wear and tear.
We want buyers to know exactly what they’re getting and to feel entirely comfortable that their needs will be met. They can access detailed information on their plans from their personalized Clyde dashboard and see exactly when their coverage begins and ends.
Uncomplicated, streamlined claim experience
Clyde directly manages the claim adjudication process through a transparent, real-time online dashboard. Customers can file claims directly—no sorting through receipts or filling out complicated forms—and see exactly where they are in the approval process.
Our support team is here to help with any issues. We pre-solve problems by pre-filling claims reports with basic information, providing answers to common questions, and making the claims process as simple as possible. This allows customers—especially the 73% of consumers who want to be enabled to solve product and service issues on their own, per market research—to get their claims handled quickly, transparently, and successfully.
Clyde’s product protection rates fluctuate depending on the item in question but are always reasonable. For example, for a purchase of headphones that cost $250, customers could get one year of coverage for $7, two years for $17, or three years for $25.
Since we handle everything from offering the plans to servicing them, there are no middlemen whose cuts drive up prices for consumers. We set fair rates that let us offer top-notch service, let brands capitalize on available margins, and let customers know their purchases will be fully covered should anything happen.
The future of extended warranties is here—and it’s us.
Extended warranties, when done right, provide the opportunity to increase customer loyalty as well as revenue. (When done wrong, everyone’s unhappy, and no one wants that.)
Fixing past problems with extended warranties and creating plans with less jargon, less hoops to jump through, and less sticker shock is better for the buyer, better for the seller, and better for extended warranties’ reputation.